Living wages
The paper focuses on living wage laws and how it affects Americans and their impact on the country’s economic development. This issue is important and relates to American history. It helps improve our understanding of the history of wage policy in America, and the roles that Henry Ford played and how the Fair Labor Standards Act was passed. It also helps us understand the difference between minimum wage and living wage and understand how a living wage of a community is calculated. The issue helps us understand how America’s living wage movement came to be and understand the policies that govern it.
Interest groups related to living wages
This research’s main group of interests is low wage workers working for various companies across the world. Also, Non-governmental agencies that focus on human rights and labor rights such as the ILO, Human Rights Watch, and Multinational Corporations are considered as interested groups on living wages.
What does your research tell you about the issue?
In my research, I learned that living wage refers to the amount of money given to employees to enable them to have a normal living standard and maintain their lives together with that of their families and have savings (Yao 2017). The living wage is considered to have a very discrete pedigree. For example, in Canada, the government tried to do this by legislating higher earnings for low-wage workers. Today, more than 140 municipalities and even Universities in America have adopted the living wage law. The ILO considers living wage as a human right, and currently, it has been included in various ILO Declarations. As much as living wage carries much weight in labor laws, there lacks a clear guideline in how it should be implemented in various countries. This has resulted in many disputes in the 21st century concerning how the living wage should be calculated and who should be given. There is a lack of a clear definition of living wages (Anker, 2011). These two factors have made it difficult for many organizations and even government agencies to adopt the living wage policy.
A living wage is considered to be similar to the minimum wage in that they are both governed by the law that states that employees should be paid a certain rate of wage. However, the two differ from each other because a living wage is intended to cover a much smaller group of employees who require a much higher salary and not every employee (Anker 2011). The living wage has both negative and positive effects on the economy. Some individuals support that it will help boost employees’ living standards, but others argue that it won’t help improve the standard of living of poor employees. Another issue concerning living wages is the various forms in which it is delivered.
There are different forms, but all ensure that the minimum wage of every worker is raised. The majorly used form is the one related to public service contracts. Other forms could also cover economic development projects, properties belonging to the government like airports, colleges, direct government employees, tourist zones, and city workers to some percentage. The living wage movement in America began in Baltimore, Maryland, in 1994 (Luce 2011). However, this movement has various limitations. The first limitation is that the movement’s primary focus is the “least common denominator” politics, and thus coalitions do not share values about the living wage (Luce 2011). Secondly, it has become very difficult for the campaigns to succeed because as the activists try to increase the living wage ordinances to cover more area, the opposition becomes stronger. Lastly, most of the local movements fail to include the international market analysis in their calculations.
Today, most individuals who are working are poor, thus being referred to as “working poor.” Researchers like Horton and Wills conducted studies to determine how poverty is related to work (Horton and Wills, 2018). According to them, the increase in low wage rates and in-work poverty has led to an increase in demand for higher living wages among workers majorly in America and the UK. The United Kingdom tried to deal with this by announcing a National Living Wage in 2015 (Horton and Wills 2018). On the other hand, in America, the Living Wage Movement was formed to challenge the low pays across the country. Increasing the living wage will have both negative and positive effects on the country. The negative effects include the fact that they create distortions in the labor market, affecting employment negatively (Lammam 2011). This because the availability of jobs for less-skilled workers will be less and also the working hours will be reduced.
Another reason is that, even though the living wage is always intended to help the poor, it’s not the poor who always receive the money, but other individuals benefit from it. Living wages also inflate city budgets through higher public service costs. The positive effects resulting from living wage are the increased productivity and decreased turnover numbers in many firms. Living wages should be increased because it helps boost the morale of workers, their working health, and improves the quality of service that workers receive (Lammam 2011). The rate of turnovers is also decreased, thus increasing productivity. With a low rate of turnovers, the employers can save money. In some research, higher wages tend to create more job opportunities for workers and even help in the growth of small businesses as the workers can buy goods from other local businesses. With living wages, consumer demand is increased as more goods are being bought, thus improving the local market. My opinion has not changed because it’s clear that living wages have more positive effects on the economy than the negative effects. With increased living wages, then the people’s living standards will be improved.